Evergrande exposes China’s lack of credit hedges

Onshore credit derivatives market has been little help during property giant’s recent woes, sources say

China's lack of credit hedges exposed by Evergrande
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An inability to offload risk into China’s fledgling credit derivatives market has made it harder for the country’s largest banks and securities houses to manage their credit risk exposure to Evergrande, the world’s most indebted property company.

China has had an onshore credit derivatives market since 2010, but a host of problems – including a lack of protection sellers, narrow reference obligations and uncertainty around government bail-outs – has meant the instruments are highly illiquid. So

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